Marceau
J.A.:
We
are
all
of
the
view
that
this
appeal
cannot
succeed.
In
spite
of
the
excellence
of
counsel
for
the
appellant’s
presentation,
we
have
not
been
persuaded
that
the
Tax
Court
judge
had
misinterpreted
the
provision
of
the
Income
Tax
Act
here
involved,
namely
subparagraph
66.1
(6)(a)(iii.
1
).
The
conclusion
that
the
cost
here
involved,
that
is
one
incurred
in
order
to
build
a
permanent
heavy
duty
road
needed
to
transport
the
product
of
a
coal
mining
operation
to
market,
is
not
a
cost
incurred
for
the
purpose
of
bringing
the
mineral
resource
into
production,
appears
to
us,
as
to
the
Tax
Court
judge,
required
by
a
proper
reading
of
the
words
used
by
Parliament.
Indeed,
the
provision
speaks
of
a
purpose
specifically
related
to
production,
an
expense
which
has
as
its
object
production,
that
is
to
say
required
to
bring
the
mine
to
the
state
where
it
will
“produce,”
bring
forth
the
mineral,
at
a
certain
commercial
level.
To
try
to
read
the
provision
as
covering
an
expense
related
to
the
transportation
of
the
mineral
after
the
resource
has
been
brought
into
production,
on
the
basis
that
I
he
expense
was
seen
by
the
promoters
as
inevitable
if
the
operation
was
to
be
economically
profitable,
would
require
an
unacceptable
extension
of
the
words
and
a
disregard
for
the
clarifications
that
can
be
drawn
from
the
formal
examples
Parliament
has
seen
useful
to
add,
and
the
legislative
context
in
which
it
appears,
as
it
was
added
to
subparagraph
66.1
(6)(«)(iii).
(a)
“Canadian
exploration
expense”
of
a
taxpayer
means
any
outlay
or
expense
made
or
incurred
after
May
6,
1974
that
is
(111.1)
any
expense
incurred
by
him
after
November
16,
1978
for
the
purpose
of
bringing
a
mineral
resource
in
Canada
into
production
and
incurred
prior
to
the
commencement
of
production
from
the
resource
in
reasonable
commercial
quantities,
including
(A)
clearing,
removing
overburden
and
stripping
and
(B)
sinking
a
mine
shaft,
constructing
an
adi:
or
other
underground
entry
Counsel
argues
that
such
an
interpretation,
by
limiting
the
allowable
expenses
to
those
incurred
in
the
physical
construction
of
the
mine,
renders
the
time
requirement
added
to
that
of
the
purpose
meaningless.
We
do
not
agree.
There
had
to
be
established
a
time
limit
to
the
period
of
construction,
in
regard
to
the
level
of
production.
The
appeal
will
be
dismissed
with
costs.
Appeal
dismissed.
mineral
resource
in
Canada
including
any
expense
incurred
in
the
course
of
(A)
prospecting,
(B)
carrying
out
geological,
geophysical
or
geochemical
surveys,
(C)
drilling
by
rotary,
diamond,
percussion
or
other
methods,
or
(D)
trenching,
digging
test
pits
and
preliminary
sampling,
but
not
including
(E)
any
Canadian
development
expense,
or
(F)
any
expense
that
may
reasonably
be
considered
to
be
related
to
a
mine,
whether
or
not
owned
by
the
taxpayer,
that
has
come
into
production
in
reasonable
commercial
quantities
or
to
be
related
to
a
potential
or
actual
extension
thereof
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